Goldstein Set To Sue SEC Over Marketing Ban

Mar 3 2008 | 10:27am ET

Phil Goldstein is taking his First Amendment fight up a few notches.

The activist hedge fund manager—best known for his successful battle with the Securities and Exchange Commission over its controversial hedge fund registration rule—is taking on the regulator once again, threatening to sue over its ban on hedge fund marketing and advertising.

The Bulldog Investors founder told the Financial Times that he had sent the SEC a letter demanding it ditch the rule, and threatening to file suit in federal court in Washington, D.C., if he did not get a response by the end of this week.

“We want to be able to have a Web site like any other business,” the outspoken Goldstein told the FT. “The only Web sites required to pre-qualify people are hedge funds and pornography.”

“Gun shops are allowed to advertise, the Massachusetts state lottery is allowed to have a Web site. We want to be treated like any other business.”

Bulldog’s Web site has already gotten it and Goldstein in trouble: Massachusetts Secretary of the Commonwealth William Galvin has sued Bulldog for allegedly marketing its wares to non-accredited investors. Goldstein has promised—and delivered—a strenuous First Amendment defense.

Goldstein, who has called Galvin a “pompous ass” and a “bully,” has said the ban on advertising is a violation of Bulldog’s free speech rights.

“Providing information is not the same as selling something, and this is still a free country, and that includes Massachusetts,” he said after Galvin filed suit. “What’s the big deal? We’re not planning a kidnapping here.”


In Depth

Financial Industry Blockchain Consortium R3 To Open-Source Platform Code

Oct 20 2016 | 9:03pm ET

Bitcoin's blockchain technology has spawned a flurry of activity among fintech startups...


U.S. Trust's Beard: The Rapid Growth of the Art Lending Industry

Oct 7 2016 | 10:55pm ET

Alternative investment managers have emerged as some of the most significant art...

Guest Contributor

Hedge Fund Marketing – Tips for Your Initial Sales Meeting

Sep 29 2016 | 5:46pm ET

There are two main goals a hedge fund should have for an initial in-person sales...